Oil and gas company Pioneer Natural Resources Company (PXD - Free Report) announced the divestment of its Alaska subsidiary to Caelus Energy Alaska LLC for cash proceeds of $300 million. The company expects to recognize a non-cash loss of about $30 million associated with the sale when it reports earnings for the first quarter of 2014.
Read the Full Research Report on PXDRead the Full Research Report on HPRead the Full Research Report on EXHRead the Full Research Report on FTKZacks Investment Research
Pioneer Natural Resources is a large independent oil and gas exploration and production company, headquartered in Dallas, TX with operations in the U.S. The company’s oil-weighted reserves base and large drilling inventory (over 20,000 liquids rich drilling locations in low-risk resource plays) with significant resource potential are catalysts to unlock value for shareholders. The company offers a deep inventory of high-return, liquids-leveraged drilling opportunities.
For 2014, Pioneer plans to spend $3.3 billion in total. Of this, the company has planned drilling capex of $3 billion and capital for vertical integration of $0.3 billion. An amount of $2.2 million has been allocated for the northern Spraberry/Wolfcamp area; $205 million has been set aside for the southern Wolfcamp joint venture area, $545 million for Eagle Ford shale and $100 million for other assets.
However, the company’s long-term production and reserve growth depends to a certain extent on its acquire-and-exploit mode. Pioneer might therefore find it difficult to complete accretive transactions in the future, which could negatively impact its growth rate.
Pioneer Natural Resources currently retains a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can consider better-ranked players in the energy sector like Flotek Industries Inc. (FTK - Free Report) , Helmerich & Payne Inc. (HP - Free Report) and Exterran Holdings, Inc. . All these stocks sport a Zacks Rank #1 (Strong Buy).